UNIFIED COMMUNICATIONS

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Will Cloud UC Breathe New Life Into Unified Communications?

Unified communications (UC) didn't really take off the way everyone figured it would. Will cloud UC succeed where its predecessors failed?

When unified communications (UC) was first bandied about by vendors and service providers, the pitch was that enterprises would flock to it en masse, wooed by the promise of seamless integration of voice, video and data across platforms and devices.

But that isn't exactly what happened--UC didn't live up to the promise, failing to integrate and interconnect on many levels. A bad economy sucked the bravado from traditional first-to-market IT mavericks, who instead retreated to the shadows of their legacy-based PBX systems rather than risk any bottom-line scrutiny that might reveal fiscal irresponsibility.

Meanwhile, vendors and service providers failed to prove a hard case for ROI, instead holding fast to isolated case studies that illustrated improved communications and collaboration without answering the much-needed question: How much will UC save in telecommunications and technology costs if I implement it?

Not surprisingly, enterprise IT responded in underwhelming fashion, and UC has limped along, a communications and collaboration strategy that sounded good in principle but simply didn't justify the cost, time and faith in its required rip-and-replace strategy.

Enter the cloud.

Although few UC vendors or service providers are willing to admit it, the cloud has delivered exactly what UC has been lacking since it first hit the market: cost savings, largely in the form of capex savings. That's especially important for larger enterprises, says Jim Burton, CEO of consulting firm CT Link.

"A good example of this was Interactive Intelligence, which came up with a cloud UC offering that it thought would be a good offering for small-business customers," he says. "It actually was the big customers that gravitated to it early because they saw the cost benefit of having someone host UC, manage it for them and not have to worry about regular updates. It's ended up being such a big thing that this year, more than 40% of Interactive Intelligence's revenue will be based on the cloud for big business."

The value of cloud UC products has not gone unnoticed by other service providers and vendors, as illustrated in the merger and partnership activity that's taken place during the past few months (see Figure 1). But for enterprise IT, the question remains: Is there value in UC--regardless of whether it's in the cloud or on-premise?

Figure 1

Company

Related M&A Activity

Details

Aastra

April 2012: Agreement with Level 3 Communications and Internet2.

April 2012: Acquired Comdasys AG.

Provides managed voice services to college campuses throughout the country.